Malaysian Police Destroy Hundreds Of Bitcoin Mining Rigs, Here's Why!

Deputy Minister of Energy Transition and Water Transformation, Akmal Nasrullah Mohd Nasir (center) (photo: x @akmalnasir)

JAKARTA - In the midst of efforts to crack down on the increasingly rampant electric theft, authorities in Malaysia took firm action by destroying 985 Bitcoin mining rigs on Monday 19 August. The rigs were destroyed using heavy equipment in a parking lot, becoming a public spectacle that caught the attention of many people.

According to Decrypt information, the operation was led by the Central Silver Regional Police, which reported that the value of the destroyed equipment reached around RM1.98 million, equivalent to 450,000 US Dollars (Rp6.9 billion). Videos circulating on social media showed Steamroller heavy equipment slowly ran over the confiscated mining rigs, although some of the devices appeared to be intact after the first destruction session.

This action is part of the Malaysian government's efforts to crack down on electricity theft which is often associated with crypto mining activities. Bitcoin mining is known as a very energy intensive activity, which could lead to a huge spike in electricity bills. In recent years, some Bitcoin miners in Malaysia have allegedly tried to reduce their operating costs by illegal means, such as stealing electricity.

Deputy Minister of Energy and Water Transformation, Akmal Nasrullah Mohd Nasir, revealed in local media that over the past five years, around RM3.4 billion or the equivalent of 776 million US Dollars (Rp11.9 trillion) of electricity had been stolen by groups of crypto miners in the country.

One case in 2020 revealed that miners used illegal cables to pass through electric meters, reducing their electricity bill to only 14.48 US Dollars (Rp223,571), whereas the value of stolen electricity reached more than 600,000 US Dollars (Rp9.2 billion).

The entire mining rig that was destroyed recently was the result of a year-long raid in the Iskandar Series, a city located nearly three hours from the nation's capital, Kuala Lumpur.

Last week, seven people were arrested for illegal Bitcoin mining activities in two cities near Kuala Lumpur. Sepang District Police Chief Wang Kamarul Azran Wan Yusof, stated that this particular operation aims to detect illegal Bitcoin mining activities involving electric theft.

This is not the first time Malaysian authorities have taken this kind of step. In 2021, about 1,069 Bitcoin mining rigs were also heavily destroyed after being linked to electric theft. In that case, six individuals were arrested, fined, and sentenced to eight months in prison.